Deeply flawed plan could cost San Diego tens of millions of dollars.

The Irwin Jacobs plan to transform San Diego’s Balboa Park may be illegal according to the City Municipal Code. In her statements to the City Council at the July 9th City Council meeting, Susan Brandt-Hawley, an attorney who worked with the Save Our Heritage Organisation in challenging the project, warned the members that in supporting the plan they would be in violation of the law.

In question are two particular sub-sections of the Municipal Code. §126.504 of the code states that:

A Site Development Permit may be approved or conditionally approved only if the decision maker makes all of the findings in Section 126.0504(a) and the supplemental findings in Section 126.0504(b) through (o) that are applicable to the proposed development as specified in this section.

§126.504(a)(1) states that “the proposed development will not adversely affect the applicable land use plan.” The Plaza de Panama plan to tear down part of the Cabrillo Bridge to build the Centennial Bridge would appear to be in minor conflict with the Balboa Park Precise Plan, which calls for reduced traffic through the Central Mesa by allowing only one way traffic through the Plaza de Panama during Balboa Park tram operating hours, and creating a more walkable environment.

The Precise Plan also calls for the construction of a large parking structure to the south of the Organ Pavilion, similar in nature to the Jacobs plan. However, there is no mention of any intent to charge for parking, as in the Jacobs plan.

But if Municipal Code §126.504(a) raises only small concerns, §126.504(i)(3) should raise major alarm bells. “To approve the bypass (Centennial) bridge,” Brandt-Hawley wrote in an email, “the City has to find that a denial of that bridge would result in the loss of all reasonable “beneficial use” of the Park. That is what the municipal code says. The code is written to deter adverse impacts to important historic properties, so it only allows such impacts if otherwise the property would have no reasonable use.”

§126.504(i)(3) states in plain language that alterations or “substantial new construction” to a designated historical landmark or structure located in a designated historical district within the City of San Diego must show that “the denial of the proposed development would result in economic hardship to the owner. For purposes of this finding ‘economic hardship’ means there is no reasonable beneficial use of a property and it is not feasible to derive a reasonable economic return from the property.”

Balboa Park’s Central Mesa, including the Cabrillo Bridge and the museums, was designated by the National Park Service as a national historical district in 1977. And since, in its current unaltered state Balboa Park remains quite useful and popular to the general public, it is not possible to find that there is “no reasonable beneficial use of the property.” Further, since Balboa Park is a public park that was never intended to generate a “reasonable economic return,” the park’s owner—the City of San Diego—cannot possibly be financially harmed.

“One of the things that interested me is where the findings for the project can be made. That’s the most important thing for any land use decision by the City Council” former City Councilwoman Donna Frye told me in a lengthy interview.

“You generally will have some comment about whether they can make these findings. No findings were discussed as far as the decision makers go. There is nothing on record from the decision makers as to how they reached their findings,” said Frye of the current council’s vote to approve the project.

The project could also put the park’s standing as a National Historical District in jeopardy. According to the environmental impact report, “Construction of the Centennial Bridge component of the project would be inconsistent with SOI (Secretary of the Interior) Rehabilitation Standards 2 and 9, thereby contributing to a substantial adverse impact to the Balboa Park National Historic Landmark District because it would alter the spatial relationships and iconic views within a portion of the Park, especially the relationship of Cabrillo Bridge and the California Quadrangle.”

The entryway changes to the park off of the Cabrillo Bridge are “rather jarring to the experience of Balboa Park,” said Frye.

Part two of the SOI Rehabilitation Standards reads:

The historic character of a property will be retained and preserved. The removal of distinctive materials or alteration of features, spaces, and spatial relationships that characterize a property will be avoided.

Part nine demands as follows:

New additions, exterior alterations, or related new construction will not destroy historic materials, features, and spatial relationships that characterize the property. The new work shall be differentiated from the old and will be compatible with the historic materials, features, size, scale and proportion, and massing to protect the integrity of the property and its environment.

The destruction of a portion of the Cabrillo Bridge in order to facilitate the construction of the Centennial Bridge violates both standards.

Complicating the project even further, the Independent Budget Analyst found that while the Plaza de Panama Committee has publicly committed to covering any cost overruns to the $45.3 million project, there is a significant caveat:

It is understood that any cost overruns for the Project beyond the anticipated $45.3 million would be fully addressed by the Committee. However, per the proposed Improvement Agreement, the Committee may terminate the Improvement Agreement at its sole discretion for any reason if the anticipated costs of the Project exceed the budget for the Project provided by the Committee to the City by more than three percent (3%).

The IBA also raised significant concerns regarding the revenue projections for the paid parking structure that is supposed to pay for the debt service on the city’s contribution to the project, determining that instead of a $200,000 annual surplus, the structure could end up leaving a $968,000 hole in the city’s general fund. Combine that with any significant cost overruns and the City of San Diego could be on the hook for tens of millions of dollars, which is more likely than the Committee would let on.

For example, the pedestrian bridge that was recently completed that links the San Diego Convention Center and the Hilton Hotel and Petco Park across Harbor Drive and the railroad/trolley tracks was completed for more than double its original estimated cost. The bridge was supposed to be built for $12.8 million, according to reports, but the final price tag tallied nearly $27 million.

The City Council also did not learn the lesson taught by the North Park parking structure adjacent to the North Park Theater. According to the minutes of a North Park Planning Committee meeting, the original revenue projections for that structure prior to its construction predicted revenues of $660,000 by 2010 with operating expenses of $218,000. “The actual revenue as reported by the Redevelopment agency is approximately $150,000 with expenses of approximately $195,000, and has been about the same or less for the five years the garage has been open.”

Revenue projections and construction costs can be grossly optimistic, and usually are, especially when project supporters have an agenda. Once construction on the Centennial Bridge begins, it cannot be undone. And should any cost projections exceed that three percent after construction starts—as would seem likely–the Plaza de Panama Committee could simply walk away, leaving the city having to find a way to foot the bill in its entirety, which would include the overestimation of revenues generated by the Organ Pavilion parking structure.

“We did not hear any response regarding what changes to the project were made since the beginning of the process,” Frye told me. “The public process involves some give and take. If there were no significant changes to the project during its development, it indicates that this was pretty much a done deal,” she said. “The public hearing process, in that case, was more of a show than anything else.”

The Save Our Heritage Organisation has announced that it will launch a legal challenge to the City Council’s decision.

Andy Cohen

Andy spent 15 years working in the highest levels of the San Diego professional sports world, including both the Padres and the Chargers. He began his foray into writing while a volunteer for Francine Busby's 2010 Congressional campaign, eventually becoming a contributor to the now defunct SDNN. He has reported on local and national politics for both the OB Rag and the San Diego Free Press. When not reporting news and events, he offers political and policy commentary from a liberal perspective, occasionally turning back to his sports roots.

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Comments

Here is a letter done by a lawyer friend who testified at the 9 July City Council hearing:

Dear Ms. Lightner:

Many thanks for having the wisdom and courage to do the right thing.

Please take some comfort in knowing this Project will NEVER be built.

As I said at the Hearing on 9 July, the Council cannot possibly and did
not make the explicit predicate findings required for a substantial
alteration to a designated historical resource. Therefore, the
“approval” of 9 July was illegal under the City’s own controlling
statutory scheme regulating the substantial alteration of a designated
historic resource. Accordingly, the approval is null and void, and will
be enjoined. The City’s own ordanance regulating designated historic
resources was intended to safeguard such resources, not to permit
private parties the power to engage in substantial alterations by
writing a check.

The City’s lawyer from Seltzer, Caplin presented the City’s position on
this dispositive question as follows:

1. The City is the “Owner” of Balboa Park [not the People];

2. Dr. Jacobs is offering millions of dollars to pay for his plan, and
his plan only;

3. Denial of Dr. Jacob’s plan would result in the loss of Jacobs’ money
to the City; and

4.The loss of Jacobs’ millions would result in economic hardship to the
City.

This argument self-destructs.

First, this would mean that the City could substiantially alter any
designated historical resource at will, if a “philanthropist” offered
money to fund part of the alteration. To illustrate, another
“philanthoropist” could offer to pay to have the California Tower in
the Park painted Purple. If the City said “no” , the City would be
damaged by the loss of the Philanthropy. So the City has the
unrestrained right to say “yes.” The Law is not as stupid as this
lawyer. Such a reading of the controlling ordinance would render the
law meaningless. It would permit unrestrained checkbook – dictated
substantial alterations of any designated historical resource at the
whim of any “philanthorpist.”

Second, the Lawyer ignored the statutory definition of “economic
hardship to the owner” contained in Municipal Code Section 126.0504 (i)
(3), and then he asserted his own new language. The statutory
definition reads :

“For purposes of this finding, ‘economic hardship’ means there is no
reasonable benificial use of the property, and it is not feasable to
derive a reasonable economic return from the property.”

The Lawyer from Seltzer, Caplin made the following assertion supported
with no legal authority : Because the “Owner” in this case is the City,
these explit statutory provisions dealing with benificial use and
economic return somehow do not control. The Lawyer went further,
asserting the “injury” resulting from the “loss” of philanthropy trumps
the Statute, and somehow this finding of economic hardship resilting
from a loss of philanthropy provides the necessary predicate for a
substantial alteration of a designated historic resource.

Any Court reviewing this record will be dismayed at the awful legal
advice being given to the City, and will enjoin this action for a total
failure to make the findings explicitly required by the City’s own
controlling statutory scheme.

I again thank you for your wisdom and courage. Please be comforted by
the fact you were and are correct.

I will not also add that you were correct on the issues of the tragic
introduction of paid parking to the Peoples’ Park, the shortfall in
revenue to pay the Garage construction bonds, the unavoidable result of
paid parking being required for all parking in the Park and the Zoo,
and the destruction of the historic fabric of the Park.

The good news is the law and wisdom will eventually prevail over the
stupidity shown by the remainder of the Council on 9 July.

Exactly right and Todd Gloria asked the question but failed to challenge this nonsense about hardship . Only the audience did via laughing at this attorney. Certain people in the city , experts in municipal code, knew this hardship argument was bull. They were disgusted at the use of this argument. But Todd Gloria and the others did what Irwin Jacobs wanted..aka meat puppet council.
Andy- Excellent follow up piece. It is a concise argument we the people have been making for awhile. – Thanks

Sir, I truly hope your trust in the wisdom and courage of the judges of San Diego and California is well placed.

Your analysis is so clearly stated, it seems invulnerable to legal shenanigans…but we’ve seen the seemingly unthinkable happen too many times in San Diego when the wealthy and powerful want their way and are paying for our elected officials to do their bidding rather than the job voters put them in office to accomplish.

Please, keep up your interest, intellectual engagement, and fighting spirit. It will take a lot of resources, time, and energy to beat back the combined forces of arrogant unearned wealth and corrupted political power that we saw Monday.

Kudos to Andy for a well written exposition of the issues, and the quote from Donna Frye backing up the testimony of good folk like Dan Soderberg at the fraudulent hearing.

I spoke to her by phone, and I only have notes from that conversation, but based on what limited information she has, she said she certainly would have voted against it. However, she was careful to note that it is possible that the City Council members do have access to further information that was not made public, which therefore allowed them to come to the decision they did. We may not know everything the council members do. So while Ms. Frye is extremely knowledgeable and well informed as per usual (which is why I asked for her thoughts in the first place), since she is no longer on the City Council she is not privy to everything they are.

Sensible disclaimer on her part. However, I don’t know what inside information the City Council would have – legal or otherwise – that would cause them to think that this project is within legal bounds, has no impact on the rules for historic designation, and fits with the idea of Balboa Park belonging to the public.

At the Monday meeting of the S.D. City Council Susan Brandt-Hawley made it eminently clear that “…the Irwin Jacobs plan to transform San Diego’s Balboa Park may be illegal according to the City Municipal Code,” and she went on to warn the members that “…in supporting the plan they would be in violation of the law.” Only Council Member Sheri Lightner heeded this warning on that day and voted not to accept the Jacobs Plan. Unfortunately, our other Council Members may have egg on their face when a judicial ruling on this action sets this matter straight.

Once again, the San Diego City Council, except for Sherry Lightner, has ignored the obvious questions and instead has embraced their support for a plan without questioning all the “guarantees” the Jacobs’ plan proposes. We’ve been down this road of “guarantees” before with the SD City Council and this time it is Todd Gloria who has left the taxpayers holding the bag if the “guarantees” don’t work out, and they won’t, Gloria having made the motion to support the plan. If this plan is not stopped the taxpayers will not only pay for the litigation to stop it but for yet another failed “guarantee,” this time, for example, the parking spaces not filled in the new garage. So get out your wallets and prepare to pay up for the further follies of this generation of the San Diego City Council.

A final thought: At some point, the members of the SD City Council must be held responsible for votes like this as they try in vain to change the subject as they move further up the political office holder ladder. It worked for Kehoe and Atkins. Let’s remember this and make it stop with Gloria.